The Senate Minority Leader has been talking tough lately about how the best way to reform the financial sector is with just three words: No. More. Bailouts.
Two main drawbacks to this Three Word Game:
(1) The collateral damage to the rest of the economy, notably the credit markets, is likely to be huge if financial behemoths fail;
(2) Politicians and policy makers know that and will tend to choose a bailout over colossal damage to the economy, no matter what they say.
One such politician is the senior Republican senator from Kentucky, who voted for the financial bailout of 2008, along with 74 other senators. (The party breakdown was 39-9 in favor among Democrats, 34-15 among Republicans.)
Senator McConnell, I call bullshit.